As we step into 2024, the complexities facing businesses have become more intricate than ever, requiring a dynamic and forward-thinking approach to risk management. Chief Risk Officers (CROs) find themselves at the forefront of this complexity, steering organisations through a myriad of modern risks. 

The persistent threat of cyberattacks and the growing sophistication of cybercrime have created a constantly shifting risk management landscape — a reality reflected in the costs.

One 2023 Gartner report predicts that worldwide spending on security and risk management will reach $215 billion in 2024, increasing 14.3% from 2023. According to the report, factors like cloud adoption, establishing a continuous hybrid workforce, and the evolving regulatory environment are generating significant impacts on risk management.  

Safeguarding operational resilience requires CROs to pay close attention to today’s top risk management trends. Being well-informed helps to achieve a more flexible approach for effectively mitigating risks and seizing strategic opportunities as they arise. 

To illuminate the path toward an optimised risk strategy, let’s examine four key trends: 

1. Removing Complexity in the Workplace Risk Culture

The rise of advanced technologies and digitalisation have forever transformed workplace cultures.

For CROs grappling with a variety of new technologies and systems, focusing on streamlining risk management across the board is key. Evolving the workplace risk culture to be more adaptive is a must and requires a rollout of simplified policies, frameworks, and risk management software across an organisation. 

Every risk environment is different and no two CROs can take the same exact approach. Rather than adopting a one-size-fits-all solution to risk management — like what many legacy technology providers offer — CROs should instead focus on establishing a strong workplace culture that provides an entire organisation with the tools, resources, and guidance to effectively manage and mitigate risk. 

2. Optimising Operational Resilience & Business Continuity

Operational resilience and improved Business Continuity Plans (BCPs) rank high on the agenda for regulators and will remain major areas of regulatory focus over the coming year.  

From a CRO’s perspective, risk management and business continuity are closely related disciplines that work in tandem to ensure the resilience and sustainability of an organisation. As such, developing a strong BCP can go hand-in-hand with successfully mitigating operational risks. 

Additionally, as organisations implement new risk management technologies, business continuity must remain a priority while old systems are replaced with new ones. 

3. Prioritising Work-Life Balance with Smarter Tech

The use of technology and advanced data capabilities in risk management are creating new opportunities for optimising the working hours of a CRO and their team. 

Implementing technologies like AI and the cloud create a more unified risk management system, enabling risk teams to communicate and collaborate more freely. By embracing new tech, CROs can establish a smarter approach for expediting the risk management process and giving risk teams more time to focus on innovative business objectives — as well as more free time for rest and relaxation. 

This focus on enhancing work-life balance for risk management teams reiterates the value of technology as a supportive tool that can reduce complexity and increase efficiency of various processes. 

4. Driving Down Cost Pressures via Centralisation & Connectivity

A tech-based approach to risk management can be vital for reducing costs — especially in the wake of increasing regulatory pressures and expectations.

Centralised, cloud-based platforms have been on the scene for some time now. Yet, hesitation to eliminate legacy systems has historically created barriers to innovation in risk management. 

Despite this previous hesitation, Gartner research reveals that the risk management space is coming around on new technologies and their applications. Cloud security stands out as one of the top sources of spending in risk management and is estimated to reach more than $7 billion in total spending in 2024. 

Unlike traditional legacy platforms, cloud-based platforms enable CROs to establish an aggregated view of risk and compliance across an entire organisation. Different departments can connect to cloud-based platforms, ensuring risk management teams have access to all the data and information needed within and outside of their domain. 

Ensuring Stability in Risk Management During Regulatory Uncertainty

In 2024, regulators face the next wave of new technologies and their various applications. 

Likewise, risk teams and CROs must consider not only the impact of new regulations but also the impact of technology on the risk management process as a whole. 

When developing a risk strategy for 2024, creating space for innovation is crucial. Leveraging technologies like AI, cloud computing, and advanced data can contribute to establishing a more resilient, efficient, and secure approach to risk management. 

The convergence of technological evolution, regulatory adaptations, and global uncertainty due to various socio-economic challenges has resulted in a more dynamic risk environment than ever before. 

As we journey into the year to come, CROs must focus on staying informed, promoting collaboration across departments, and fostering an organisation-wide culture of risk awareness.